Regime change for USD

The USD can’t rally on a 12% jump in the NASDAQ. I think we are entering a pure sell USD regime where we will see a high-Sharpe rip to 1.1500 in EURUSD. As such, I like buying EURUSD on a strong CPI today. Rate differentials are losing their sway over the USD for the first time in my life.

Buy EURUSD at 1.1051 with a stop at 1.0874. That stop loss is below all the moving averages and the cloud. A strong CPI will lead to higher yields, which isn’t really all that USD bullish anymore. Trump blinked on higher yields, but that doesn’t mean 10-year yields can’t retest 4.50% while the USD sells off in tandem.

Final Thoughts

Policy uncertainty and stagflation risks have not gone away. The take profit is getting close-ish in gold.

Have a funny-smelling day.

good luck ⇅ be nimble